IFC mulls $111mln backing for Liquid/Neotel deal

The IFC is considering an investment made up of equity and quasi-equity and totaling $111 million for a stake in the special purpose vehicle that will be set up to hold the combined interests of the planned $560 million acquisition of Neotel, South Africa’s second largest wholesale fiber network, by Liquid Telecommunications and community-based investment company Royal Bafokeng Holdings.

Neotel, which is owned by Tata Communications, Nexus Connexion and CommuniTel, recently agreed to be acquired by Liquid Telecom and Royal Bafokeng Holdings following c competitive bid process. The acquisition will strengthen Liquid Telecom’s position as the largest independent pan-African telecommunications provider.

With over 24,000 kms of long distance backbone servicing 12 countries Liquid Telecom has major operations in Kenya, Nigeria, Rwanda, South Africa, Zambia and Zimbabwe. Econet Wireless Global, Strive Maziyiwa’s company owns 51% of the company while Singapore-based investment company Gateway Partners holds another 10% stake. The balance of the company is held by Amro International Holdings, Liquid Telecom’s CEO Nic Rudnick’s company.

According to the Summary of investment Information posted on the IFC’s website, the development finance institution’s Board is projected to meet in mid-September to review the proposed investment.